Sdmce & Society, Vol. 74. No.

2, April 2010, 215-247

Critical Globalization Studies: An Empirical

and Theoretical Analysis of the New Imperialism

CHRISTIAN FUCHS
Abstract. Affirmative globalization studies stress positive aspects
of global capitalism, while critical globalization studies use no-
tions such as "Empire" and "new imperialism" to analyze the
global economy's negativity. Critical globalization suidies, how-
ever, frequently lack a precise theoretical notion of imperialism.
TTiis absence can be corrected by connecting the notion of a "new
imperialism" to the classical theory' of imperialism, as found in
Lenin's canonical work. Empirical analysis of data from recent
decades shows that Lenin's aspproach remains broadly correct,
and that adaptation of his method to new realities strengthens
the theoretical foundation of recent work on global capitalism.

T
HIS PAPER SEEKS TO CONTRIBUTE to the reconsideration
of Lenin for analyzing and criticizing contemporary capital-
ism, by using his notion of imperialism (Budgen, Kouvelakis
and Zizek, 2007; Lih, 2005; Zilek, 2004a) to determine whether con-
temporary capitalism can be seen as a new form of imperialism. The
method for doing this will be, primarily, macroeconomic statistical
analysis. For each characteristic oí imperialism that Lenin identified,
at! empirical analysis of contemporary capitalism will be provided. I
hopeby this means to show the importance of Lenin's theory for con-
temporary globalization sttidies.
Globalization has been one of the most discussed topics of the
past decade. It has been defined in various ways: "an increasing num-
ber of social processes that are indifferent to national boundaries"
(Beck, 2000, 80); the "capacity to work as a unit on a planetai^ scale
in real time or chosen time" (Castells, 2000, 10); the "intensification
215
216 SCIENCE ¿3* SOCIETY

of worldwide social relatiotis which link distant localities in such a

way tbat local happenings are shaped by events occuring many miles
away and vice versa" (Giddens, 1990, 64) ; tbe "widening, deepening
and speeding up of worldwide interconnectedness in all aspects of
contemporary social life .. . tbe growing extensity, intensity and veloc-
ity of global interactions" (Held, el al, 1999, 2, 15; see also Held and
McGrew, 2007,2f) ; "the compression of tbe world as a whole" (Robert-
son, 1995, 40); "circtmistances wbere territorial space is stibstantially
transcended" (Scbolte, 1999, 12); and "the rapid developing and ever-
densenitig network of intercontiections and interdependencies that
characterize modern life" (Tomlinson, 1999, 2).
These definitions have in common not only emphasis on the
increasing qtianlity. scale, and speed of social interactions, but also
characterization of globalization as a general pbenomenon. If, for
example, one considers world religions, the Roman empire, tbe em-
pire of Han Cbina, tbe British Empire, tbe world market, colonial-
ism, migration Hows that resulted from tbe Irisb potato bligbt, the
system of submarine cables established in tbe middle of the 19tb cen-
tury that formed tbe first global .system of communication, or the
Internet, tben it becomes clear ihat globalization indeed seems to
bave general aspects. However, general definitions pose tbe tbreat
of constructing mythologies that see only positive sides of globaliza-
tion and ignore the negative consequences of contemporary global-
ization processes. Tbis can create tbe impression tbat society neither
needs cbange nor can be altered by collective political action.
It is therefore no wonder that some of tbe abovementioned au-
thors are fairly optimistic about tbe effects of contemporary global-
ization. Tbey speak of globalization resulting in the acceleration of
tlie "consciousness of tbe global whole in the twentieth century. . . .
tbe intensification of consciousne.ss of the world as a whole" (Robert-
son, 1992, 8), "emergent fonns of world interdependence and plan-
etary consciousness" (Giddens, 1990,175), tbe creation ol "agrowing
collective awareness or consciousness of the world as a shared social
space" (Held and McGrew, 2007, 3), or argue that "htiman beings
assume obligations towards tbe world as a whole" (Albrow, 1997, 83).
Such formulations imply that contemporary globalization is bring-
ing about increasing freedom and equality, despite tbe fact that we
live in a world of global ineqtiality. One compelling example is tbe
ratio of tbe average salary of Cbief Executive OIFicers (GEOs) of large
 CRITICAL GLOBALIZATION STU DIES 217

U. S. corporations to that of an average U. S. worker, which currently

stands at 245 to 1 (Sutcliffe, 2007).
T h e developed world accounts for approximately 25% of the
world's population, btit has accounted for more than 70% ofthe world's
wealth on a continitotis basis since 1970 (Fuchs, 2008). The least de-
veloped countries' share of wealth has dropped from above 3 % to just
over 1% since 1980 (Fuchs, 2008). In 2008, the total sales o f t h e ten
top-selling worldwide companies (US$2533.5 billion) were 2.3 times
as large as the total gross domestic product (GDP) o f t h e 22 least
developed countries (US$1{)81.H billion) (Fuchs, 2008). These data
indicate that we live in a world of persisting inequality that is a global
p h e t i o m e n o n , and that therefore people are not moving closer
together, but tend to be rnore separated. C^ass divisions have been
widening, not closing. Wealth and its distribtition are objective foun-
dations of global consciotisness. If there are widening class divisions,
then focusing on positive concepts such as global consciottsness
for describing the contemporain world ttinis into an ideology. O n e
can therefore conclude that uncritical optimism regarding global-
ization can easily turn into mythologizing. To refer to and to reload
Lenin for explaining contemporary globalization is a demytholo-
gizing move that cotinters the globalization optimism advanced by
bourgeois thinkers. It furthermore serves the political task of repeat-
ing "in the present global conditions, the 'Leninian' gesture of
reinventing the revolutionary project in the conditions of imperi-
alism, colonialism, and world war" (Budgen, Kouvelakis and Zi2ek,
2007, 3).

1. Theoretical Foundations

For Hardt and Negri, Empire is a system of global capitalist rule

that is "altogether different" frorn imperialism:

Imperialism was really an extension of the sovereignty of the European

iiiition-states beyond their own boundaries. . . . in contrast to imperialism.
Empire establishes no territorial center of power and does nol rely on fixed
botindaries or barriers. It is a decentered and deterritorializing apparattis
of rule that progressively incorporates the entire global realm within its open,
expanding frontiers. . . . First and foremost, then, the concept of Empire
posits a regime that effectively encompasses the spatial totality, or really that
rules over the entire "civilized" world. (Hardt and Negri, 2000, xii, xiv.)
218 . SCIENCE éb'SOCIETV

This system is dominated by the United States, which sees itself as

possessing a global right of militaiy intervention and as the world's
most powerful actor. Ftirther actors in this network are international
organizations, such as World Trade Organization (WTO), Interna-
tional Monetary Fmid (IMF), the United Nations, Group of Eight
(G8), transnational corporations, nation-states, and civil society or-
ganizations (Hardt and Negri, 2000, 309-324).
Harvey argties that various forms of continuous primitive accumu-
lation based on colonizing spaces are needed for overcoming capital-
ist crises of overaccumulation. This takes on the form of spatio-temponil
fixes, that is, "temporal deferral and geographical expan.sion" (Harvey,
2005,115). Overaccumulatiíín produces capital stirpltises that cannot
be invested within existing boundaries; as a restilt, "profitable ways must
be fbtmd to absorb the capital siirpltises" (Hai*vey, 2005, 88) by "tem-
poral displacement through investment in long-term capital projects
or social expenditures (such as education and research) that defer the
re-entry of capital valties into circulation into the future" a n d / o r "spa-
tial displacements throtigh opening tip new inarkets, new production
capacities, and new resource, social and labor possibilities elsewhere"
(Harvey, 2005, 109). Capital accumtilation, therefore, in search of
profitable spheres, produces spaces and thereby creates uneven geo-
graphical development. The new imperialism is for Harvey a specific
form of primitive accumulation that developed after 1970: neoliberal
imperialism (ibid., 184, 188, 190), or "imperialism as accumulation by
dispossession" (137-182).
Accumulation by dispossession employs four strategies for turn-
ing assets into profitable use, that is, the commodification of every-
thing (Harvey, 2005, 165ff): the privatization and commodification
of public assets and institutions, social welfare, knowledge, nature,
cultural forms, histories, and intellectual creativity (the enclosure of
the commons); financialization that allows the overtaking of assets
by spectilation, fratid, prédation, and thievery; the creation, manage-
ment, and manipulation of crises (for example, creation of debt cri-
ses that allow the intervention of the IMF with strtictural adjtistment
programs so that new investment opportunities, deregulations, lib-
eralizations, and privatizations emerge); and state redistributions
which favor capital at the expense of labor (Harvey, 2005, 160-165;
Harvey, 2006, 44-50). For Harvey, new imperialism is a revisiting of
 CRITICAL GLOBALIZATION STUDIES 219

the old, robbery-based imperialism of the 19th century in a different

place and time (HatA'ey, 2005, 182).
For Harvey, the main goal of the U. S. war against Iraq is the trans-
formation oflraq into a neoliberal capitalist economy (Harvey, 2005,
214f). This allows the United States to have geopolitical intltience in
the Middle East so that it can control the global oil spigot, which is
necessary for controlling the global economy {Harvey, 2005, 19).
"What the U. S. evidently seeks to impose by main force on Iraq is a
ftill-fledged neoliberal state apparatus whose fundamental mission is
to facilitate conditions for profitable capital accumulation" (Hai*vey,
2006,11). For Harvey, the seizure of Iraq is a form of military-enforced
accumulation by dispossession. Opening up new spaces cotild either
be achieved by militaiy force and commercial pressure or voluntary
opening (Harvey, 2006, 108). 9/11 was used as an opportunity for
mobilizing patriotism and creating an American nationalism that
tolerates and supports imperialist expansion (Han'ey, 2005, 15, 193).
Iraq shottld also serve as powerfttl geostrategic position for the United
States in Eurasia (Harvey, 2005, 85).
In line with Harvey's thesis, Christian Zeller (2004a) argttes that
the new imperiali.sm is based on a global economy of dispossession.
Methods of dispossession for him are war, privatization, mergers and
acquisitions, subcontracting and alliances, and the commodiftcation
of nature and knowledge with the help of patents and intellectual
property rights. New imperialism is, in tliis context, permanent pritni-
tlve accumulation. Another feature is the emergence of an accumu-
lation regime dominated by finance capital (Zeller, 2()04b, 82ff).
Ellen Meiksins Wood uses the term "imperialism" in the sense of
the militar)' creation of a global economic and political hegemony
of the United States. For her, globalization means the "opening of
subordinate economies and their viilnerability to imperial capital,
while the impeiial economy remains sheltered as mtich as possible
from the obverse effects" (Wood, 2003b, 134). Worldwide U. S. mili-
tarism shows that globalization does not bring about an end of the
nation-state, but that "the state continues to play its essenfial role in
creating and maintaining the conditions of capital accumulation"
[ibid., 139). Imperialism today depends more than ever on a system
of multiple nation-states, dominated by the United States. "The new
imperialism we call globalization, precisely becattse it depends on a
220 SCIENCE 6 ' SOCIETY

wide-ranging economic hegemony that reaches far beyond any state's

territorial boundaries or pohtical domination, is a fortu of imperial-
ism more dependent than any other on a system of multiple states"
(154).
Characteristics of the new imperialism that Wood mentions are;
war without temporal end, geographic limits, and specific aims; pre-
emptive military strikes, and universal capitalism. She argues that the
new imperialism has been created after World War II (Wood, 2003b,
131,151 ). The primary tnotivation for the war against Iraq is for Wood
not oil supply, but securing tiie global hegemony of the United States.
For Wood, the new imperialism means the global unilateral rule of
the United States, "unilateral world domination" {ibid., 164). "In
all cases, the overriding objective is to demonstrate and consolidate
U. S. domination over the .system of multiple states" (167).
William 1. Robinson (2007) argues that Wood's account lacks
enipirical evidence and suggests that contemporary capitalism
can best be characterized as global capitalism that is based on a
transnational capitalist class, a transnational state apparattis, and
transnational capital that diffuses the whole Marxian circuit of capital
— Money-Commodity . . . Prodttction . . . ('.ommodity'-Money'
(M-C . . . P . . . C'-M') — all over lhe globe. In this circuit, tnoney is
invested for buying the commodities labor power and means of pro-
ditction. In the production process, labor transforms the means of
prodtiction and creates a new commodity that contains surpUis labor.
This transformed commodity is sold on the market so that surplus
value is realized in the form of profit that is controlled by capitalists,
hi the early 20tb centui^, according to Robinson, only the selling of
commodities took place at a transnational level (see also Robinson,
2004). Imperialism is for Robinson not a recent re-emerging phenom-
enon, but means "the relentless pressures for outward expansion of
capitalism and the distinct political, military and ctiltural mechanisms
that facilitate that expansion and the appropriation of sut pluses it
generates" (Robinson, 2007, 90). Robinson is interested in new quali-
ties of global capitalism, such as information and communication
technologies that allow capital to go global, global mobility of capi-
tal, the global outsourcing of production, subcontracting, or new
management philosophies.
Leslie Sklair (2002) employs the notions of global capitalism and
capitalist globalization in a manner that is comparable to Robinson.
 CRITICAL GLOBALIZATION STUDIES 221

Sklair conceptualizes globalization with tbe concept of transnational

practices, by which he means "acting within specific institutional
contexts that cross state borders" (Sklair, 2002, 84) in economy, pol-
ity, and culture-ideology. Tbe global system works in three spheres:
economic, political, and cultural-ideological.
In order to work properly the dominant institutions in each of the three
spheres have to take control of key resources. Under the conditions of capi-
talist globalization, the transnational corporations strive to control global
capital and material resources, the transnational capitalist class strives to
control glohal power, and the transnational agents and institutions of the
culture-ideology of consumerism strive to control the realm of ideas. (Sklair,
2002,115.)

Tbe transnational capitalist class consists of executives of transnational

corporations (TNGs); bureaucrats, politicians, professionals, mer-
chants, and consumerist elites that have global perspectives and life-
styles and identify with "tbe interest of the capitalist global system"
(Sklair, 2002, 9, 98-105, Robinson, 2004, 36).
Gontemporary tbeories of imperialism, empire, and global capi-
talism can be categorized on a continutmi that describes the degree
of novelty of imperialism. On one end of the continutmi there are
authors who argue tbat imperialistn no longer exists today; tbat a post-
imperialislic empire bas emerged. Tbe stress is on discontinuity {e.g.,
Panitcb and Gindin, 2004, 2005; Robinson, 2004, 2007; Hardt and
Negri, 2000, 2004, Negri, 2008; for discussions of Hardt and Negri,
Buchanan and Pahtija, 2004; Gallinicos, 2007, 345; Lafley and Weldes,
2004; ZiXek, 2004b). On the other end of the continuum tbere are
authors who argue that contemporary capitalism isjust as imperialis-
tic as 100 years ago, and tbat tbere is a new imperialism. The stress is
on continuity {e.g., Gallinicos, 2003, 2005, 2007; Harvey, 2003, 2005,
2006, 2007; Wood, 2003; Zeller, 2004a, b). A middle ground is the
assumption tbat imperialism bas reemerged and been qualitatively
transformed, tbat through capitalist development and crisis new quali-
ties of capitalism have emerged and otbers been preserved, and tbat
the new qualities on the one band constitute a return to capitalist
imperialism, but that on tbe otber band tbere are aspects of imperi-
alism today that are different from the imperialism tbat Lenin, Lux-
emburg, Kautsky, and Bukharin described 100 years ago {e.g., Sklair,
2002; O'Byrne, 2005). Some of the most important tbeories of new
222 SCIENCE à? SOCIETV

imperialism, empire, and global capitalism will now be discussed, with

a view to which concepts of imperialism underlie these theories and
what role Lenin's theory of imperiaHsm plays in this context.
Theories ofa new imperialism, empire, and global capitalism
have brotight about discttssions ofthe economic and political strate-
gies of capitalism and their limits. They therefore have an important
public and political function. But in many cases the notions of imperi-
alism employed in these discussions remain rather imprecise (Castrée,
2006) or unexplained (Brenner, 2006). This might be related to a lack
of grotmdingin classical theories. The discussion of Lenin's notion
of imperialism remains rather superficial. It is therefore important
to review this concept, in order to see if it can be applied today.
For Lenin, there are five characteristics of imperialism:

1 ) The concentration of production and capital developed to such a stage

that it creates monopolies which p!ay a decisive role in economic life.
2) The merging of bank capital with industrial capital, and the creation,
on the basis of "fmance capital," ofa financial oligarchy.
3) The export of capital, which has become extremely important, as distin-
guished from the export of commodities.
4) The formation of international capitalist monopolies which share the
world among themselves.
5) The territorial division of the whole world among the greatest capitalist
powers is completed. (Lenin, 1917,237.)

Lenin's work, Imperialism, the Highest Stage of Capitalism^ is not, as

suggested by some authors, only a very rough definition (Zeller, 2004b,
88,111 ) and not "pamphleteering" instead of theorizing (Harvey, 2007,
59). In the first six chapters, Lenin gives a detailed empirical account
of economic developments that he then summarizes in the well-known
definition, given in chapter seven. It is therefore an interesting task to
observe which empirical indicators for the existence of imperialism
Lenin used. Bob Sutcliffe (2000, 74) describes the works by Hardt and
Negri, Harvey, and Wood on new imperialism as "empirico-phobic."
In contrast, Lenin gave close attention to the empirical data that was
available at his time. He undertook "enormous preparatoty work"
(Labica, 2007, 223) for his study, work that is documented in his 21
Notebooks on Imperialism (Lenin, 1912-1916), which contain notes on
150 books and 240 articles. To re-engage with Lenin's theory of im-
perialism today, one should therefore update his theoretical argu-
 CRITICAL CLOBALIZATION STUDIES 223

ments and his support of the.se argtiments by data, using the same
rigorous empirical method — a feattne that contemporain works
unfortunately frequently lack. Updating Lenin can be undertaking
by .substituting "for the data he presented what we have available
today" (Labica, 2007, 232). To repeat and reload Lenin today means
"to retrieve the same impulse in today's constellation" (Zizek, 2004a,
11; cf. Budgen, Kotivelakis, and Zizek, 2007, 1-4). This also means
to take Lenin asa theoretical and methodological model for contem-
porary critical globalization studies.

2. The Concentration of Capital

"The enormous growth of industry and the remarkably rapid

process of concentration of prodtiction in ever-larger enterprises
represent one of the most characteristic features of capitalism" (Lenin,
1917,178). Lenin identified an antagonism between competition and
monopolyas an immanent feature of capitalism (180,185, 236, 260f).
The formation of monopolies and the concentrafion of capital are
for Lenin not an exception to the rule of competition, btu a neces-
sai7 otitcome of capitalist compefition.
Concentration indicators that Lenin used included: the develop-
ment of the number of large enterprises, the share of workers in the
economy that are employed by large enterprises, and the share of
otitput in an indtistry that is produced by large enterprises.
In order to assess if there is a new imperialism, one has to find out
if capital concentration is a feature of contemporary capitalism. Within
such a framework, one can analyze concentration in the information
sector. Concentration generally means tliat a small number of enter-
prises controls a large share of assets (such as capital, workers, infra-
structure). Data from Eurostat tell the stor)-: Large companies in the
EU27 counüies (those witli more than 250 employees) account for only
0.2% of the total number of enterprises, but for 32.9% of all employ-
ees, 42.5% of total turnover, and 42.4% of total value added.
Industries have become more concentrated throtigh mergei"s and
acquisitions (M&A). So a sharp rise in the total number and value of
mergers and acquisitions is likely to indicate increasing concentrafion.
The total valtie of annual worldwide mergers and acquisifions has
sharply increased, from US$74.5 billion in 1987 to 880.5 billion in 2006
(Table 1).
224 SCIENCE ¿s'SOCIETY'

TABLE 1
Number and Vahie (Billions of USS) of Mergers and Acquisitions

Ntimher Value Number Value

1987 863 74.3 1997 4987 304.8

1988 1480 115.6 1998 5597 531.6
1989 2201 140.4 1999 6994 766.0
1990 2503 150.6 2000 7894 1143.8
1991 2854 80.7 2001 6035 594.0
1992 2721 79.3 2002 4493 369.8
1993 2835 83.1 2003 4562 297.0
1994 3494 127.1 2004 5113 380.6
1995 4247 186.6 2005 6134 716.3
1996 45H9 227.0 2006 6974 880.5

Source: UNCTAD

In total numbers of M&:<\ this means an increase from 863 an-

nual M&A in 1987 to 6974 in 2006 (Table 1).
Figure 1 shows that the finance sector accounted for the largest
share of these M&A in 2006: 24.6% (1717) of all M&A, whereas the
transport, storage and commtmication sector accotinted for 5.4% (379)
of all M&A and tbe printing and ptiblishing indttstries accounted for
2.0% ( 142). All of these sectors have experienced dramatic rises in the

Figure 1 Total Number of Mergers and Acquisitions in Selected

Industries

1800
1600
1400
1200
tooo

Source: UNCTAD
Mining, auarrv^ng and petroleum -Trade
Transport, storage and communications- -Finance
activjbes 'PrinUng, Publishing, and Allttd Services
 CRITICAL GLOBALIZATION STUDIES 225

ntimber of M&A. but the largest and most rapid increase is in finance,
which is an indication that finance is the most heavily concetUrated
sector (finance is excluded ftom the Eurostat data cited above).
The data presented in this section suggest that the first charac-
teristic of Lenin's definition of imperialism, capital concentration, is
valid today. Manufacturing, seivices, and finance are highly concen-
trated industries.

3. The Dominance of Finance Capital

Einance capital "is the bank capital of the few big monopolist
banks, merged with the capital of the monopolist combines of manu-
facturers" (Lenin, 1917, 237). Under imperialism, finance capital
commands "almost the whole of the money capital of all the capital-
ists and small businessmen and also a large part of the means of pro-
duction and of the sources of raw materials of the given countiy and
of a number of countries" (Lenin, 1917, 190). Tbe banks' control of
theflowof investment money that is used for operating corporations
gives them huge economic power for controlling the capitalist economy
(194). Lenin mentioned that banks are influential in accelerating
technical progress (202). Capital concentration and the formation
of finance capital are connected developments (203). Finance capi-
tal aims at generating extraordinarily high rates of profit (210). A
finance oligarchy consisting of rentiers emerges in the imperialist
stage (213).
The indicators that Lenin used for verifying this second charac-
teristic of imperialism included: the percentage of total deposits con-
trolled by banks of a certain size (measured by total controlled capital) ;
the number of holdings and establishments of certain banks; the
number of letters received and dispatched by certain banks; the amount
of capital held by certain banks; the capital invested by certain banks
in a country; the profit rate of certain banks; and the total securities
issued by certain banks.
I have analyzed the Forhe,s 2000 list of the world's 2000 biggest
companies in 2008, by sector. The results are presented in Eigure 2.
Finance companies and financial service corporations together ac-
counted for the vast share of capital assets in 2008 (75.96%). The
second largest sector was oil, gas, and utilities (5.82%). The third
largest sector was the information sector (4.63%), comprised (for
226 SCIENCE 6= SOCIETY

Figure 2 Share of Selected Industries in Total Capital Assets of the

World's Largest 2000 Corporations

4.63%
1.96%
11,51%
• !.48%
• 1.36%
• 1.29%
• 0,97%

175,96%

Source: Forbes 2000, 2008 List

• Finance (Banking. Financiáis, Insurance)

• Oil & Gas Operations. Utiiities
• Information (Telecommunicalions. Technology' Hardware & Equipment. Media. Software & Services. Semiconductors
• Consumer Durables
• Food (Food, Dnnks & Tobacto: Food Markets; Hotel, Restaurants & Leisure)
• Conglomerates
• Materials
• Transpoituiion
• Constniction

Statistical reasons) of the following subdomains; telecommunications,

technology hardware and equipment, media content, software, and
semiconductors. The data indicate an economic predominance of
finance.
The data in Figure 2 are for the year 2007. Data for 2008, the year
a new worldwide economic crisis started, show that the fmancial sec-
tor suffered tremendoiLs losses: The world's biggest 176 diversified fi-
nancial corporations had combined losses of $46,27 billion, the world's
92 largest insurance companies had losses of $61.8 billion. Nonethe-
less, the fuiancial sector still accounted for 74.9% of all assets of the
world's 2000 largest corporations, oil, gas 8c utilities for 6.2% and the
information economy for 4.6%. This are only minor changes in com-
parison to 2007, which shows that the economic crisis did not under-
mine the intra<apitalist hegemony of financial capital.
Figure 3 shows the growth of financial asset transactions by in-
vestment fLmds, insurance corporations, and pension funds for two
selected countries, the United States and Japan. The value of finan-
cial transactions by U. S. insurance corporations and pension funds
 CRITICAL GLOBALIZATION STUDIES 227

Figure 3 Total Financial Asset Transactions (m % of GDP, currency,

deposits, securities, loans, shares and other equity)

140

120
100 ^ ^ ^ ^

O O O O O Q O O
M LO
o t ^ r j u i ^ o
Source: OECD Institutionai Investors Statistics
-•—USA: Investment Funds -Japan: Investment Funds
-*~USA: Insurance corporations, pension funds •Japan: Insurance corporations, pension funds

increased from 51.7% ofthe U. S. GDP in 1980 to 122.92% of GDP

in 2007; the value of financial transactions by U. S. investment funds
increased from 5.3% of GDP in 1980 to 85.9% of GDP in 2007. In
Japan, insurance and pensions corporations and pension funds in-
creased the value of their financial tran.sacl,ions from 21.6% of GDP
in 1980 to 75.6% of GDP in 2006; investment funds from 16.0% to
72.7%.
The perception tliat speculative finance capital dominates contem-
porary economies has in recent years resulted in the emergence of
concepts such as finance market capitalism (Bischoff. 2006; Huff-
schmid, 2002) or financial accumulation regime {Aglietta, 2000;
Chesnais, 2004; Zeiler, 2004b) for describing contemporai7 society.
Statistical data confirm that today the second criterion of Lenin's
definition of imperiaHsm is valid. Finance capital has grown tremen-
dously in the past 30 years and commands "almost the whole ofthe
money capital" (Lenin, 1917, 190). Its assets are so large that it has
the power to infiuence all other economic sectors. Since the begin-
ning ofthe 1980s, finance capital has increased its infiuence, im-
portance, and concentration after it was subsumed under industrial
capital in the 60 years preceding 1980. The emergence of liberal-
ized global financial markets has enabled these developments. There
are new qualities of finance capital today that were not present at the
time of Lenin.
228 SCIENCE àf SOCIETY

Today, the financial market is more than stocks and bonds: there
is the powerful influence of insurance companies, pension funds,
investment funds, and there are new financial instrutnents stich as
finance dérivâtes (exchange-traded futures, exchange-traded options,
over-the-counter swaps, over-the-counter futures, over-the-counter
options), insurance markets, foreign exchange markets. These mecha-
nisms have increased short-tenn financial profits, but simultaneously
advanced the gap between financial values (what Marx termed ficti-
tious capital) and actually accumulated values (between finance and
economic commodity prodtiction) so tbat finance markets have be-
come highly volafile. Excellent examples are stibprime lending and
mortgage-backed securities, high-risk financial mechanisms that have
been at the heart of the financial crisis that originated in the financiali-
zation of the U. S. housing market and hit the world economy in 2008.
Finance capital is the dominant fraction of capital, which shows
that an important characteristic of imperialistic capitalism is present
today.

4. The Importance of Capital Export

"Under modern capitalism, when monopolies prevail, the export

of capital has become tbe typical feature" (Lenin, 1917, 215). The
goal is to achieve high profits by exporting capital to countries where
"capital is scarce, the price of land is relatively low, wages are low,
raw materials are cheap" (Lenin, 1917, 216). Indicators that Lenin
used for verifying the third characteristic of imperialism included the
absolute amount of capital invested abroad by certain nations, and
the geographical distribution of foreign direct investment.
Foreign direct investment (FDI) as an indicator for capital export
represents only a fraction of total investment in overseas production
(Held, et ai, 1999, 237; Held and McGrew, 2007, 91; these authors
mention a share of 25% ). Hirst and Thompson ( 1999, 77, 79,87) argue
that FDI measures only what companies invest in their foreign affili-
ates, but not what they invest in their home countries. Although FDI
might not be fully reliable as the only indicator, it nonetheless gives
an indication of the level of global activities of corporations. Tables 2
and 3 show that FDI flows have increased from approximately 0.5% of
world GDP at the beginning of the 1970s to a share between 2% and
4.5% since the end of the millennium. FDI stocks have increased from
 CRITICAL CLOBALIZATION STUDIES 229

TABLE 2
World Foreign Direct Investment (FDI):
Inflows and Outflows, % of World GDP
Year Inflows Oiitllows

1970 0.51 0.47

1975 0.51 0.48
1980 0.47 0.47
1985 0.45 0.49
1990 0.91 1.04
1995 1.15 1.22
2000 4.43 3.89
2005 2.10 1.86
2006 2.69 2.50
Source. L'NflTAD

a level of about 5% of world GDP at the beginning of the 1980s to 25%

of world GDP in 2006. This does not prove that capital accumulation
is global, but it is an indication that in comparison to the phase of
Fordist capitalism, capital export through global outsourcing of pro-
duction in order to t educe labor costs andfixedcosts has become more
important. The economy has become more global in the past 30 years
in comparison to tbe years 1945-1975.

TABLE 3
World Foreign Direct Investment (FDI) in Stock, % of World GDP
1980 4.64 1993 8.65
1981 4.97 1994 9.00
1982 5.32 1995 9.30
1983 5.46 1996 10.18
1984 5.62 1997 11,68
1985 6.20 1998 13.93
1986 6.12 1999 15.92
1987 6.51 2000 18,24
1988 6.60 2001 19.63
1989 7.32 2002 20.62
1990 8.04 2003 22.11
1991 8.35 2004 23.00
1992 8.09 2005 22.37
2006 24.69

Sourer. UNCTAD
230 SCIENCE 6= SOCIETY

The trans nation al ity index provided by the United Nations Com-
mission on Trade and Development (UNCTAD) is calculated as the
average of ibur shares: FDI infiows into a country as a percentage of
gross fixed capital formation for the past three years; FDI inward
stocks as a percentage of GDP; valtie added of foreign affiliates as a
percentage of GDP; and employment of foreign affiliates as a per-
centage of total employment in 2005. The simple average for devel-
oped countries for the year 2005 is 24.4%, for developing countries
21.8%, and for transition countries 19.6% (World Inve.stment Report,
2008). These data seem to confirm calculations by Hirst and Thomp-
son (1999,79-87) that show that "between 65 and 70 per cent of MNG
value-added continues to be produced on the home territory" (Hirst
and Thompson, 1999, 95). In the EU27 countries, 16% of the com-
panies engage in international sourcing, 4% plan to engage in it, and
80% do not engage and do not plan to engage in it (Eurostat). In
2006, the top 100 TNGs listed in the World Investment Report had
an average transnationality index of 6L6% (WIR, 2008, 28), which
shows that large mtilti- and ü-ansnationals indeed do have transnational
value sources.
The biggest 2000 TNCs had sales of $1414.95 billion in 2007
(calculation based on Forbes 2000, 2008). In 2007, world GDP was
54,347,037,614,014 current $US. Worldwide compatiy revenues made
up 27% of world GDP, which is approximately $14,673 billion (World
Development Indicators). So the bigge.st 2000 TNGs accounted for
9.6% of the worldwide reventies in 2007. These data show that we do
not fully live in a globalized economy, but that transnational corpo-
rations have become vexy important economic actors that manage
to centralize a significant share of worldwide value generated to a
large degree not in their home economies, but at the transnational
level. Transnationalization is an important tendency in the contem-
porar)' capitalist economy. The most important reason for interna-
tional sourcing for European companies is the reduction of labor
costs: 45% of EU27 companies with sourcing activities say that this is
an very important motivational factor, 28.5% say it is an important
one, and only 9.9% say it is an unimportant factor (Eurostat). The
two other most important reasons mentioned are reduction of costs
other than labor costs and access to new markets. This confirms that
transnational sotircing .should be conceptualized within a theory of
imperialistic capitalism.
 CRITICAL GLOBAIJZATION STUDIES 231

Foreign direct investments have significandy increased in the past

30 years, as production has become more global. The world economy
is still significantly rooted in national economies, but transnational
corporations engage in global outsourcing of labor in order to save
labor and other costs and to increase profits. By transnational pro-
duction and investment activities, they have managed to centralize a
significant share of worldwide economic value. Capital export, the
third characteristic of imperialism mentioned by Lenin, has in com-
parison to the period 1945-1975 become far more important, per-
haps qualitatively so.
The growth of FDI inflows and outflows shows that the economy
has become more global in the past 30 years in comparison to 1945-
1975. The largest TNCs in the world have operations that are pre-
dominantly global, i.e., located outside the home bases of these firms.
This applies for sales, assets, and employees of these companies. The
data confirm the presence of Lenin's third characteristic of imperi-
alism today.

5. The Economic Division of the World Among Big Corporations

Lenin argued that under imperialism, big companies dominate

the economy. They divide among themselves spheres of influence and
markets and make use of cartels, syndicates, and trusts. Finance capital
struggles "for the sources of raw materials, for the export of capital,
for 'spheres of influence,' i.e., for spheres of good business, conces-
sions, monopolist profits, and so on; in fine, for economic territory
in general" (Lenin, 1917, 266).
Lenin used the following indicators for the fourth characteristic:
tbe number of sub-companies of certain corporations, the development
of turnover, number of employees, and net profits of specific big com-
panies. Whereas the third characteristic focuses more on economic
activities that cross nation-state borders and the economic benefits that
derive from them, the fourth characteristic covers the spatial dimen-
sion of tbese activities. This distinction is indicated by the term "divi-
sion of the world among capitalist combines" (characteristic four) in
contrast to the term "the export of capital" (characteristic three). The
two characteristics are nonetheless certainly closely linked.
Figure 4 shows that the share of developed countries in total
FDI inflows has fluctuated between 55% and 90% and the share of
232 SCIENCE ¿f SOCIETY

Figure 4 Distribution of FDI Inflows

Source: UNCTAD Year

•Developing economies —•—Developing economies excluding China -*-Developed economies

developing countries between 10% and 45%. Overall, eapital export

has remained an unequal affair. The vast bulk of transnational in-
vestments stays within developed countries. Developing countries
remain marginalized, although there are times when they achieve
significant increases.
In 1970, the developing economies accounted for 28.7% of FDI
inflows, in 2006 for 29.0%. So overall, there has not been much
change. FDI outflows have continuously been very unequal since the
1970s, although the developing countries have increased their over-
all share (Table 4). The preponderance of investment comes from
developed countries. The developed countries' share in FDI outflows
has dropped from 99.6% in 1970 to 84.1% in 2006. There is a more
significant change in FDI outflows than in inflows. Lenin (1917,217)
cited a statistic that displays the distribution of the total foreign di-
rect investments of Great Britain, France, and Germany in 1910:
32.1% were invested in Europe, 36.4% in America, and 31.4% in Asia,
Africa, Australia. This shows that capital export was at the beginning
of the 20th centuiy, just as at the beginning of the 21st, shaped by
global inequality.
Figure 5 shows that Europe is the most important receiver oí FDI.
In 2006, it accounted for 44% of all FDI iriflows, North America for
19.2%. ' :
The most important change in FDI since the 1970s has been the
increase of FDI inflows in Asian developing economies (Figure 6).
 CRITICAL GLOBALIZATION STUDIES 233

TABLE 4
Developed and Developing Countric-s:
Shares of Foreign Direct Investment Outflows (%)
Year Developed Developing
1970 99.64 0.36
1975 98.13 1.87
1980 94.14 5.86
1935 93.75 6.25
199Ô 94.81 5.19
1995 84.66 15,16
2000 88.98 10.76
2005 84.45 13.84
2006 84.13 14.34
Sourer. UNCTAD

The FDI infiow share of developing economies in Asia increased from

6.4% in 1970 to 19.9% in 2006; the infiow share of Latin America
changed from 11.9% in 1970 to 12.7% in 2004 and 6.4% in 2006;
the infiow share of Africa decreased from 9.4% in 1970 to 2.7% in
2006. Africa and large parts of Latin America are excluded from capi-
tal investment. Asia has attracted significant infiows. This is an im-
portant qtialitative change in the landscape of capital export. China
is the most important developing location for FDI inflows; it increased
its share from 0.000187% in 1970 to 13.3% in 1994, wbich then again
dropped to 9.5% in 2003 and 5.3% in 2006. Nonetheless, the data

Figure 5 Share of PDI Inflows - Developed Regions

Source: UNCTAD Year

-America —»-Asia —*-Europe
234 SCIENCE & SOCIETV

Figure 6 Share of FDI Inflows - Developing Regions

fM IN IN IN IN IN

Source: UNCTAD ^^»'

—•-Africa Hi-Latin America - * - A s i a -«-China -^*-East Asia —•—Oceania

show that China has become an important location for capital exports.
Another significant change in capital export has been the decline of
the United States as leading investor and the rise of Europe as lead-
ing investing region.
In 2006, Europe accounted for 55.0% of FDI outflows and North
America for 21.9% (see Figure 7). North America's leading position

Figure 7 Share of FDI Outflows - Deveioped Regions

Year
Source: UNCTAD

•America •Asia —*—Europe

 CRITICAL GLOBALIZATION STUDIES 235

at the beginning of the 197()s has vanished; its capita! exports have
decreased by 40 percentage points, from a 60% share to a 20% share.
Developing economies in Asia have become more important in
capital export (Eigure 8): They accotuited for only 0.007% of FDI
outflows in 1970 and for 9.6% in 2006. Ghina (including Hong Kong,
Macao, and Taiwan) accounted for 5.6% of these 9.6% in 2006. The
rise of Ghina as important capital exporter and importer has been
the most significant change in the past 30 years in the world ecotiomy.
In terms of capital export, Ghina is now more important than Japan,
which accounted for 3.8% of capital exports in 2006. Latin America
increased its share in world capital exports from 0.2% in 1970 to 4.0%
in 2006, Africa's share changed from 0.21 % to 0.7%. Africa is defacto
excluded from capital export and import.
The world economy has remained in the past 50 years a geo-
graphically strongly divided class system. Lenin's fourth characteristic
of imperialism, the asymmetric spatial division of the world economy,
is valid today. However, some important qualitative changes have
taken place, especially the rise of Ghina as important actor in the
world economy and the deterioration of North America's position
that benefitted bijth Europe and Asia. FDI inflows are stratified in a
relation of 70:30 between developed and developing economies,
world imports in a relation of 65:35, world exports in a relation of

Figure S Share of FDI Outflows - Developing Regions

Source; UNCTAD

-Latin America • -Eastern Asia

236 SCIENCE 6= SOCIETY

6U:40. Europe is the most important sotirce and drain of FDI. Africa
and large parts of Latin America are excluded from capital invest-
ment. Asia has attracted significant inflow growths. China is tbe most
important developing location for FDI inflows. In 2006, developing
Asia's share of FDI inflows was larger than that of North America.
North America's position as leading capital export region has since
the 1945 deteriorated significantiy (from a share of 60% to 20%),
Europe accounted for more than 50% of world capital exports in
2006. Latin America and Africa are essentially excluded lrom capital
export, whereas Asia, due to the economic rise of China, has become
important and now accounts for almost 10% of all capital exports.
In international commodity trade, Europe has remained the lead-
ing import region in the past 50 years, Asia has become a more im-
portant import region than North America, Latin America and Africa
are both essentially excluded from world trade (imports and exports).
World exports is an area that has undergone vei7 significant changes
in the past 50 years: Europe became the most important export re-
gion, North America's position vastiy deteriorated (decrease from a
30% share to one slightly above 10%), developing Asia became the
second largest export region. China has become the most important
developing and Asian trade nation and is in this respect now even
more important than Japan. The most significant changes of the
spatial structiue of the world economy in tbe past 50 years has been
the deterioration of North America in the areas of capital exports
and commodity exports and the rise of China as important location
for FDI inflows and important trading countiy, especially in exports.
Capitalist production and world trade are spatially stratifled, although
China is gaining importance, there is a continuous huge predomi-
nance of corporations from Western countries both in capital export
and world trade.
Giovanni Arrighi (2005) argues that there are two new elements
of the capitalist world system: the divergence between military (U. S.)
and fluancial (Cbina, East Asia) dominance, and shift of the epicen-
ter of tbe global economy to East Asia, especially China). Our data
show tiiat wbile it is overdrawn to consider East Asia as epicenter of
the world economy, it has nonetheless become an important eco-
nomic region with China as a powerful economic actor. ' T h e fimda-
mental point is that China is important for the OECD countries not
only as a source of cheap, and potentially disruptive imports, but also
 CRITICAL GLOBALIZATION STUDIES 237

as an increasingly important market for exports" (Glyn, 2007. 96).

Andrew Glyn's analysis is certainly right, but it should be added that
China has itself become one of the leading export nations. David
Harvey (2003, 2005) argues that investment of OECD countries in
East Asia, especially China, is a spatio-temporal fix for the overaccumu-
lation crisis of capitalism. This interpretation makes sense, but it
should be added that China in addition has become an important
export nation.

6. The Political Division ofthe World as Completed Process

Lenin defined thefifthcharacteristic of imperialism as the "mono-

polistic possession of the territories of the world which have been
completely divided up" (Lenin, 1917, 237). Each dominant state
exploits and draws super-profits from a part ofthe world. "Each of
them, by means of trusts, cartels, finance capital, and debtor and
creditor relations, occupies a monopoly position on the world mar-
ket" (253). Lenin argues that under imperialism, all territories on
the globe have come under the inlluence of capitalist countries. A
re-division would be possible at any time, but not a new seizure. In
imperialism, there are not just simply colonies and colony-owning
countries, but also semi-colonies, politically independent countries,
which are "enmeshed in the net of financial and diplomatic depen-
dence" (234). Eormal dependence under imperialism becomes "a link
in the chain of operations of world finance capital" (235).
Indicators that Lenin uses for the fifth characteristic include: the
development ofthe percentage of territories that belong to the Eu-
ropean colonial powers, and the area and population under the con-
trol of certain colonial powers.
Panitch and Gindin (2004, 2005) argue that the failure of classi-
cal theories of imperialism was their focus on inter-imperial rivah"y and
a reduction of state power to the economy (a similar critique of Lenin
is made by Ahmad, 2004). Lenin never spoke of "inter-imperialist ri-
x-alry" as a characteristic feature of imperialism, but he did say that the
division ofthe world has come to an end under imperialism (226f).
This means that there is a global rule of capitalist structures. Whether
one, two, or more countries dominate, whether they enter military
conflict or economic confiict — these circumstances can all be ex-
plained as specific historical expressions of this characteristic. Lenin
238 SCIENCE & SOCIETY

Stressed the dynamic character of this division and therefore .speaks

of possible re-divisions (Lenin, 1917, 227). The only time Lenin men-
tioned rivalry in chapter VI of Imperialism was when he said that capi-
talist corporations try to "make it impossible for theirrivalsto compete"
(232). He wrote that finance capital is the dri\ing force of territorial
conflicts: "Finance capital strives to seize the largest possible amount
of land of all kinds and in any place it can" (233). This does not mean
that there is necessarily an inter-imperialist military rivahy between
countries. But it is wrong to conclude that there is no livalr)- today.
So for example the European Union sees the United States as its big-
gest economic competitor and has therefore set itself the goal to
become "the most competitive and dynamic knowledge-based econ-
omy in the worid" until 2010 (Lisbon Agenda). There certainly is
economic rivalry, although no major military rivalries between the
major countries are present today. However, military interventions
such as in Afghanistan and Iraq on the one hand and global terror-
ism on the other hand show that today there is militaiy rivalry among
great powers concerning world influence and in certain parts of the
globe. Both economic rivalry and military conflicts are indicative of
what Lenin described as conflicts for hegemony between great powers
(which must not necessarily be nation-states because "great powers"
are powerful actors, which can also be corporations, not only nation-
states) that constitute "an essential feature of imperialism": "rivalry
between a number of great powers in the striving for hegemony, i.e.,
for the conquest of territory, not so much directly for themselves, as
to weaken the adversary and undermine his hegemony" (239).
Tbe United States certainly is ihe dominant global military power
today and has been successful in imposing its will by militaiy means
without much resistance by Europe, Rvissia, (^hina, or other coun-
tries. The difference in military power can be gauged, for example,
by government expenditures. In 2006, tbe EU2.'i countries devoted
10.8% of their total government expenditures to defen.se, 12.9% to
education, and 18.8% to health. By contrast, tbe corresponding shares
for the LJnited States in 2008 were 17.1% on defense, 3.2% on edu-
cation, and 11.2% on health. That the United States is a dominant
global military power means only that it bas been successful in being
hegemonic, which does not mean that it will never again be chal-
lenged by others witb military means.
 CRITICAL GLOBALIZATION STUDIES 239

Finance capital today is the dominant form of capital. If there

were really a fully American Empire, as Panitch and Gindin say. then
finance capital would have to be fully dominated by U. S. institutions.
However, of 495 companies that are listed under the categories bank-
ing and diversified financiáis in the Forbes 20()()\\?,i of the world's big-
gest companies in 2008, 100 (20.2%) are from the United States, 114
from the European Union (23.0%), and 178 (36.0%) from countries
in East Asia/Southeast Asia/South Asia (China. Hong Kong, India,
Indonesia, Japan, Malaysia, Singapore, South Korea, Taiwan, Thai-
land). This shows that there is not an American finance empire, as
claimed by Panitch and Gindin (2005), but that U. S. capital stands
in fierce competition with European and Asian capita!.
There are several competing explanations for the U. S. invasion
of Afghanistan and Iraq (see Callinicos, 2003a, 2005, 2007; Harvey,
2005. 2006; Panitch and Gindin, 2004, 2005; Wood, 2003b): secur-
ing access to oil as economic resource, securing worldwide geopo-
litical hegemony, the expansion of U. S. economic power in tbe face
of deterioration of the U. S. position in export of capital and com-
modities and the strong position of Europe and China, the conquest
of strategic countries in the Middle East iu order tt) be better equipped
for limiting the infiuence of Islamic nations and groups that challenge
Western world dominance, or the struggle for the extension of ueo-
liberal capitalism all over the world. It is imaginable that the these
wars are caused by a combination of some or all of these elements.
No matter which factors one considers important, the war against
Afghanistan and Iraq, global terrorism, and potential future wars
against countries like Iran, Pakistan. Syria, Lebanon, Venezuela, or
Bolivia, shows that war for securing geopolitical and economic infiu-
ence and hegemony is an inherent feature of tlie new imperialism and
of imperialism in general. Although investment, trade, concentration,
transnationalization, neohberalization, structural adjustment, and
financialization are economic strategies of imperialism that do not
resort to militaiy means, it is likely that not all territories can be con-
trolled by imperialist powers and that some resistance emerges. In order
to contain these counter-movements, overcome crises, and secure eco-
nomic infiuence for capital, in the last instance warfare is the ultimate
outcome, a continuation of imperialism by non-economic means in
order to foster economic ends.
240 SCIENCE àf SOCIETY

Statistical data show ÍX/ÍO.VÍ that economic ends can be important

influencing factors for the wars in Iraq and Afghanistan. Table 5 shows
that foreign investments have boomed in Afghanistan since 2002 and
in Iraq since 2003. Oil is the main economic resource in Iraq. In 2002,
99.3% of all exports fi om Iraq were fuels. In 2006, this level remained
ata high level of 93.9% (UNGTAD). In 2006. the value of annual Iraq
oil exports was 2.3 times the 2002 value.
Table 6 shows the increase of Iraq fuel exports in absolute terms.
In the same period (2002-2006), a.s fuel exports from Iraq climbed,
the value of oil imports by the US increased by a factor of 2.8 and the
value of oil imports by the UK by a factor of 3.8 (Table 7). These data
stiggest that investment opportunities and resotirce access are impor-
tant, but certainly not the only factors in the invasions of Iraq and
Afghanistan by the US and the UK.
In 1988, the annual military expenses of the United States were
$484 billion. There was a drop in spending after the end of the Gold
War (1998: $329 billion). The new wars in Afghanistan and Iraq re-
sulted in a rise to $441 billion in 2003 and $547 billion in 2007 (all
valties in constant US$) (SIPRI Military Expenditure Database). In
2007, the United States accotmted for the largest share of world mili-
tary spending (45%), followed by the UK and Ghina (each 5%) {SIPRJ
Yearbook 2008). Gomparing annual U. S. military spending for the
years 2001 and 2006 shows a growth of 30% for overall expenditure,
47% for military operations and maintenance, and 58% for research,
development, test and evaluation {SIPRI Yearbook 2007, 276). In 2006,

TABl-E 5
Foreign Direct Investment Flows into
Afghanistan and Iraq, Million US$
Year Afghanistan Iraq
2000 0.17 -3.14
2001 0.88 '• -6.45
2002 0.54 * -I..^9
2003 2.01 -0.02
2004 0.62 300.00
2005 3.61 , 515.30
2006 2.08 27L76
Source. UNCTAD
 CRITICAL GLOBALIZATION STUDIES 241

TABLE 6
Euel Exports from Iraq, Billion US$
1995 514.6 2001 12797.9
1996 502.6 20Ü2 12139.1
1997 3728.4 2003 9418.0
1998 7288.6 2004 17201.0
1999 16538.0 2005 22013.6
2000 20547.8 2006 27597.8
Sourer.LlNCTAD

41 U. S. companies accounted for 63% of the sales of tbe top 100

arms-producing companies in the world (ibid.). In the period 1998-
2007, annual world military expenditures increased by 45%. These
data show that the new imperialism is based on V. S. military hege-
mony in military outlays and activities.
The U. S.-led war in Iraq and -Afghanistan is tbe practical valida-
tion of the presence of the fifth cbaracteristic of imperialism today.
Military conflicts that aim at territorial control and global hegemony
and coimter-iiegemony are immanent features of the new imperial-
ism. Lenin (1917, 264) argues tbat imperialism is leading to annex-
ation and increased oppression and consequently also to increased

TABLE 7
Fuel Imports by the United Kingdom
and the United States, Billion SUS
Year UK US
1995 9241.1 62984.1
1996 10930.3 77062.8
1997 10699.2 82545.3
1998 7705.6 62152.2
1999 8478.0 79273.4
2000 14673.2 139621.6
2001 14686.5 129014.4
2002 14380.8 121927.4
2003 18242.5 163251.8
2004 29684.3 216377.0
2005 42770.0 298037.3
2006 54240.6 345058.8
Sourer. UNCTAD
242 SCIENCE &> SOCIETY

resistance. 9/11 and the rise of global terrorism can be interpreted

as a reaction to global U. S. economic, political, and cultural influ-
ence. This has resulted in a vicious cycle of global war that creates
and secures spheres of Western infiuence and global terrorism that
Uies to destroy Western lifest\'Ies and Western dominance. At the time
of Lenin, there was an organized labor movement that resisted im-
perialism and culminated in the October Revolution. Under the new
imperialism, the political left is marginal and hardly influences worid
pohtics, which are dominated by Western imperialists and Islamic
hardliners. Therefore today there seem to be much less political
grounds for emancipatory transformations than at the time of Lenin.
In the early 21st century, the formula no longer is "socialism or bar-
barism," but rather "barbarism or barbarism."

Conclusion

In this paper, I have tried to show that Lenin's notion of imperial-

ism is important for analyzing contemporary capitalism. Contemporary
capitalism is characterized by a new imperialism, in Lenin's mean-
ing of the term. There has been a return to the fundamental charac-
teristics of imperialism identified by Lenin, but at tlie same time these
characteristics take on new forms.
The data suggest that contemporary capitalism is an imperialis-
tic capitalism in Lenin's sense, and that Lenin's five characteristics
of imperialism can be reformulated for contemporary capitalism:
1. Capital concentration: Capital concentration remains an im-
portant characteristic of industry, services, and finance. 2. Finance
capital: Finance capital is still the dominant form of capital today.
There are, however, more than stocks and bonds on financial mar-
kets, as insurance companies, pension funds and investment funds
have gained in influence, and there are new financial instruments
such as finance derivatives. Neoliberalism has created volatile global
deregulated financial markets. The 2008-09 financial crisis has re-
sulted in losses in all parts ofthe economy, not only of finance, but
finance is still predominant.
3. Capital export: this third characteristic of imperialism men-
tioned by Lenin, has in comparison to the period 1945-1975 become
iar more important; transnational corporations are in fact a qualita-
tively new development of this feature. 4. Economic division: The
 CRITICAL GLOBALIZATION STUDIES 243

asymmetric spatial division of the world economy remains valid today.

The new aspects are the Increased weight of Europe in FDI and the
emergence of Asia, especially China, as a major importer and exporter
of capital. Finally, 5. Pi)litical division. Tbe U. S.-led war in Iraq and
Afghanistan is the practical validation of the continuing presence of
this filth cbaracteristic of imperialism, Mihtar>' conflicts that aim at
territorial control and global hegemony and counter-hegemony are
immanent features of the new imperialism. The USA is a global mili-
tar)'hegemon, but not a global economic hegemon. It faces economic
challenges by Europe and China.
Lenin observed on the First World War and the imperialism of
his time:

Capitalism has grown into a world system of colonial oppression and of the
fmancial strangulation of the ovci^whclming majority of the population of
the world by a handful of "advanced" countries. And this "booty" is shared
between two or three powerful world plunderers armed to the teeth
(America, Great Britain, Japan), who are drawing the whole world into their
war over the division of //iWr booty. (Lenin, 1999, 28.)

Lenin described the First World War as "war for the division of the
world" {Lenin, 1999, 27).The War was tbe expression of tbe political-
economic conflict between what Lenin termed imperialism's "great
powers" (Lenin, 1917, 239). Imperialism is neces.sarily a system of
political-economic competition between great powers. In present-
day conditions, military conflictos and economic conflicts do not co-
incide. Ai"ab nations question Western hegemony with military means
and Asian nations such as China with economic means. Lenin spoke
of conflict between great powers, but this did not necessarily mean
that these powers must be nation-states, or that economic and mili-
taiy conflicts must always coincide. Militaiy conflicts have economic
dimensions and economic rivalries can, and in many cases do, result
in wars, but if and when this happens is not predetermined, but a
matter of tbe contingent complexity of societal power struggles. We
simply do not know for example if in the futtire there will be a war
between Cbina and the Western nations for political-economic he-
gemony. To assume that this will necessarily be tbe case would reveal
a deterministic understanding of bi.story, sometbing that is unfortu-
nately not alien to Marxism and has proved to be a failure in the past.
244 SCIENCE (^ SOCIETY

The future cannot be predicted; we can, however, say that, unless

alternatives to the global rule of capitalism emerge in the 21st cen-
tury, it will be another century of violence, with new territorial wars
waged for political-economic reasons. >

Unified Theory of Information Research Group

University of Salzburg
Sigmund Haffner Gasse IS
5020 Salzburg
A ustria
christian.fuchs @sbg. ac. at

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